Today we are going to talk about Search Engine Marketing (SEM) and in particular Google Ads campaigns. SEM, unlike Search Engine Optimisation (SEO), uses paid advertising (Paid Search Advertising, PSA); we have already talked about SEM and SEO in the article SEO and SEM: two complementary web marketing strategies for “positioning” websites.
The best known SEM tool is Big G’s online advertising programme, Google Ads. The platform can be used to support the sale of products and services, create awareness around a brand, and increase traffic to one’s own website.
One of the peculiarities of Google Ads is that advertisers only pay for their ads when the target audience interacts with them, e.g. if users click on the ad to visit the website or call the business.
Moreover, there is no minimum expenditure required and it is the creator of the Google Ads campaign who can choose the objectives, the type of ads, the budget and assess its effectiveness through metrics analysis.
However, to better understand how Google Ads works, we decided to interview Fabio Antichi, one of best well-known Italian experts in SEO and digital marketing.
Interview to Fabio Antichi, digital adv & SEO consultant
Thank you! In general, “conversion” refers to the desired outcome for the company, the action that a customer or potential customer takes, such as buying a product, subscribing to a service, filling out a form or signing up for a newsletter.
Conversion is, therefore, the ultimate goal of the marketing strategy, and is often measured through the conversion rate, i.e. the ratio between the number of visits to the website and the number of actual conversions.
In some cases, however, e.g. when the purchasing funnel is complex, intermediate conversions can also be triggered, i.e. actions which occur before those which are really profitable for us and which aim to segment users
However, in summary, conversion is when you invoice.
Google Ads helps advertisers to convert by offering them the possibility to create and manage highly targeted advertisements, which are shown to Google users based on their searches, interests and online behaviour.
Advertisers can select relevant keywords (i.e. search terms used on Google) for their business and set a budget and bid for the ads, which are then displayed at the top of Google search results or on partner websites and apps in Google’s network.
In addition, Google Ads provides a wide range of targeting tools, such as remarketing audiences, similar audiences and geographic targeting, which allow advertisers to reach potential customers even more precisely.
Finally, through the Google Ads platform it is possible to monitor ads performance in real time and make adjustments to improve conversion rates, such as adjusting keywords, ad text or target audience.
What is, however, very interesting that Google Ads allows you to do and that very few other platforms offer is the possibility of setting a ROAS, i.e. a minimum return on investment.
For example, if you set a target ROAS of 500%, it means that for every euro spent on advertising, you aim to generate 5 euros in revenue from conversions. And if you don’t reach the 5 euros we asked for, Google Ads WILL NOT SPEND.
Once the ROAS target has been set, Google Ads uses machine learning and artificial intelligence to adjust ad bids according to the likelihood of generating conversions at a lower cost than the pre-determined ROAS target. In this way, advertisers can maximise the return on their advertising investment and improve the performance of Google Ads.
There are different types of Google Ads campaigns, each of which is designed to achieve specific marketing goals. Below is a list of the main ones.
The set-up of each of these campaign types depends on the marketing goals to be achieved and the audiences to be targeted through the advertisements.
In general, to set up a campaign on Google Ads, it is necessary to:
Furthermore, the configuration may vary according to the type of campaign chosen. For example, for shopping campaigns, a product feed needs to be configured, while for video campaigns, a video advertisement needs to be created. In any case, Google Ads offers tools and guides to help advertisers configure campaigns effectively and optimally.
But also here there is news: a few months ago, Google Ads added PMAX campaigns, i.e. campaigns with very high artificial intelligence (AI).
In order for all campaigns to perform at their best, but especially for PMAX, a correct setting of the tracks is essential, in the sense that the Google Ads pixel or the Google Analytics pixel must receive very detailed information on user behaviour so that its AI can function correctly, without campaigns running “at random”.
CPC (cost per click) and PPC (pay per click) are often used synonymously. In both cases, these are advertising models in which advertisers pay only when a user clicks on the ad. In other words, the cost of advertising depends on the number of clicks the ad receives. We could say that:
Other advertising models also exist, including:
CPM (cost per thousand): in this model, the advertiser pays for every thousand ad impressions, i.e. every time the ad is displayed, regardless of whether the user clicks on the ad or not.
CPA (cost per action): in this model, the advertiser pays only when the user performs a specific action on the website after clicking on the ad, e.g. if he or she makes a purchase or completes a form.
ROAS: as mentioned above, we can tell Google Ads how much it has to bill for each euro spent on it in order to proceed, if it cannot generate that revenue then it must not spend.
I will spare you the other models that are only used in special cases. The choice of the advertising model, in fact, depends on the marketing objectives of the business, but today, given that the software allows it, practically all of us adopt the ROAS so that we only spend if we receive in return the number of contacts or minimum revenue that sustains the cost of the campaigns + the necessary profit for the entrepreneur.
That’s a million dollar question! So, according to Google Ads minimum budgets would often be important for many businesses, in the order of at least 10 times the CPL (cost per lead).
To make it clear: let’s assume that for every 10 requests for quotes I get two and that each of them is worth € 2,500. In practice, 10 contacts give me a revenue of € 5,000; of these, the marginality, i.e. the profit, is € 2,000.
How much can I spend on these 10 contacts that brought me this revenue? Assuming that I do not want to earn less than 1500 euros, I am left with 2000-1500 euros, i.e. 500 euros to spend on advertising, which gives me, divided by the 10 requests for quotes, a maximum cost per quote of 50 euros.
Google tells us that it wants at least 10 times the cost per lead, so with the assumptions above to get the 10 leads that would bring me 5000 euros of turnover per day, it would take at least 500 euros per day. Almost always too much for someone starting out. Not that it is wrong, it really is the most effective way to get a result, but the customer is like St. Thomas, if he does not see he does not believe!
We could repeat this reasoning for any type of business or e-commerce. Varying the numbers according to the business almost always results in important numbers. Then add to this the fact that Google Ads needs a few days before it is “up and running”, during which one could spend without receiving and… so what? And so we start from a compromise: for small local business even 5 euros per day may suffice, for a structured company or an e-commerce I do not recommend going below 20-30 euros per day, then it goes without saying, once you have proven the goodness of the medium and the profit that comes from it, you give gas!
Today, the super mega important thing is tracking, creative and our “uniqueness”. The PMAX campaigns we saw earlier allow us to have a very powerful weapon that can sell a lot with just a few clicks! This weapon, however, our competitors also have it, let’s remember!
How, then, to scalp them? Good tracking, i.e. a lot of data provided to Google allows us to make it think better and to get our campaigns off the ground sooner; use clever images and videos (now almost compulsory), which does not mean expensive or requiring a TV set, just a mobile phone today and we can “overtake” competitors with poor performance (just think that Google, if we do not feed it a video, makes it itself, but with very poor quality); be unique: in increasingly inflated markets we must first understand why a person should buy from us and not from one of our competitors; having identified this key, campaign setting will be just a technicality.
He refers to old guides, fixates on the cost of a click without looking at the earnings and the strategy in its totality, does not set up the merchant centre well (another chapter would be needed here) and leaves tracking with a basic setting (very frequent and super damaging), tries to impose his own method on Google, thing that cannot be done for years now (unless one loses his way by doing so many conversions).
A lot, but always less. Veterans of the field like myself come from a world where we kneaded keywords by separating the singular from the plural, typos, etc. Today, doing such a thing would be like trying to empty the sea with spoonfuls. In many of today’s campaigns, keywords no more exist at all! And Google clearly tells us that we will see even fewer of them in the future. So where it is still possible for us to use them we use them, but we already prepare the alternative route in order not to get screwed at the next update!
A lot and it is an evergreen topic. Here too, in the past, we used to be able to configure targeting in a direct and punctual way with time slots, age, income, place of residence, and many other possible features. Today, it is no longer so easy, but it is still possible; we do it indirectly providing Google “stimuli” so that it goes where we want. Thus, through audience segments and customer clusters, demographics and much more, we can still reach our target and, above all, our business objective.
Thank you again! On these topics one could and does write poems, we could talk about it for days. I’ll close saying just one thing: Google Ads is a very powerful tool that generates revenue, but one must have clear business goals and a very good technical knowledge of the tool, or getting screwed out of money by Google is a flash in the pan.